In one of the biggest shareholder rebellions in months, 52.7 per cent of investors at the company’s annual meeting voted against Burberry’s remuneration report containing a non-performance related shares award which could be worth £19.5million for Bailey by 2018.

The award was made in October prior to Bailey’s elevation from chief creative director to chief executive in May. His pay package also includes a one-off performance-based shares award worth £7.2million, a £1.1million salary and an annual £440,000 cash allowance.

After the vote Bailey played down the prospect he may hand back some pay. “It’s not about giving something up. It is not something I made the decision on, it is the remuneration committee and the chairman and the board.”

The vote against the report is non-binding and only related to awards given over the last financial year but chairman Sir John Peace said he was disappointed and would talk to shareholders to allay their concerns. “I want to understand why they felt so strongly to vote against. When I understand it, I’ll know what to do,” he said.

He added that the £19.5million shares award came as a result of competing job offers for Bailey from rivals in the luxury ­sector.

“He had offers significantly higher than anything we were able to pay. The board took the view it was essential we retained Christopher,” he said.

“We know it is a lot of money but much of it is performance related.”

Burberry believes yesterday’s actions were a protest vote as a binding remuneration policy resolution was supported by over four-fifths of investors, though 16.1 per cent still voted against.

The Institute of Directors described the remuneration vote as a “warning shot”. Dr Roger Barker, director of corporate governance said: “Shareholders are clearly not convinced that executive pay has been transparently linked to tough performance targets. Pay awards must be based on proven performance.

"This is the first year that investors have had a binding vote on future pay policy in addition to the advisory vote on this year’s actual pay. They chose to express their displeasure using the advisory vote. There is a real risk they will feel compelled to use their new binding powers next year.”